The tournament will be played in India after three years where spectators are allowed as well, who were a big miss in recent Covid-stricken years. Popular celebrities are also expected to adorn the galleries. It could also turn out to be the final IPL season for former Indian captain Mahendra Singh Dhoni, helping stakeholders play on the sentiment of the mavericks.
IPL also has set three new rules, promising the games to be more pacy and exciting.
The razzmatazz is crazy for the fans and the players, who along with support staff and franchisee members, will be travelling across the country over the next 52 days till May 28 playing a total of 74 matches.
How you spend money
India is seeing inflationary pressure where prices of staple pulses to essential medicines have jumped while the unemployment rate poses a grim picture. However, the cricket frenzy takes over for a significant part of the population in the urban, small towns and even in most parts of the hinterland, who directly or indirectly dole out cash for IPL in several ways. Indians will soon be burning increased broadband data or buying cable tv packs to watch the 52-day event, consuming high electricity when the nation’s grids are stressed with surging power demand amid scorching summer days. Potential stadium, restaurant or pub visits for live action, fantasy gaming and merchandise purchases, among others, add to the bills.
In fact, consumers are exposed to a volume of brands and may go ahead making impulsive purchases. The sponsors therefore are not pouring money for nothing.
Star & Jio: Time to add revenues
ET reported on Friday citing multiple industry executives that the IPL will generate more than Rs 5,000 crore from TV and digital advertising in 2023 based on the deals Disney Star and Viacom 18 have closed so far. These two companies are in a tough competition to generate maximum revenue after they picked up TV and digital rights separately worth billions of rupees.
Reliance won the lion’s share of IPL broadcasting rights (for 2023-2027) for a total of Rs 23,758 crore. Disney Star bagged the TV rights for the Indian subcontinent, paying Rs 23,575 crore.
Disney Star is believed to have closed sponsorship deals worth Rs 2,400 crore and is in negotiations to close another Rs 600 crore of transactions, ET reported citing a person with direct knowledge of the matter.
Viacom18, which has set an ad sales target of Rs 3,700 crore, has closed deals worth Rs 2,700 crore, as per a company executive, who did not want to be named.
Disney Star’s sponsors are Tata Neu, Dream11, Airtel, Coca-Cola, Pepsi, Asian Paints, Cadbury, Jindal Panther, Parle Biscuits, Britannia, RuPay, Kamla Pasand, and LIC.
Viacom, which will be streaming the event for free on its OTT JioCinema has Dream11 as a co-presenting sponsor. It has also got sponsorships from JioMart, PhonePe, Tata Neu, AJIO, Parle Agro, ET Money, Castrol, Haier, TVS, Cadbury, ITC, Coca-Cola, Kamla Pasand, Puma, Ultratech Cement, Kingfisher, Rapido, Amazon, Louis Philippe and Indeed, which recently announced layoffs.
Sponsorship & money deals
The cash-rich tournament has now become a decacorn with a $10.9 billion valuation and is said to be the country’s first unicorn in 2008 at $1.1 billion in valuation at inception, according to an analysis by D&P Advisory. A KPMG survey had reported that the tournament contributed Rs 11.5 billion ($182 million) to the domestic economy in 2021, even when played within confines adhering to Covid protocols.
It is obvious that brands would like to be associated with something so huge. Tata has likely paid around Rs 670 crore for two years of title sponsorship of IPL. However, sponsorships go beyond the ordinary and you have umpire, stumps or even audio and headgear sponsors.
Rajasthan Royals recently roped in UBON to be their audio and headgear sponsor.
“Compared to other sports leagues, including international events, IPL offers more extended periods for sponsorships, which can help brands achieve higher visibility and recall,” Mandeep Arora, Managing Director, and Spokesperson of UBON, told ET Online.
“The league also offers a versatile range of advertising and branding opportunities, including jersey sponsorships, on-ground advertising, and digital promotions, headgear and audio sponsors, banking sponsors which help brands massively to reach its target audience in their budgets,” Arora said.
This year small finance banks starting from Equitas to Ujjivan Small Finance Bank have also increasingly joined the wagon to put in money as sponsors.
Reliance-owned sports marketing company Rise Worldwide has inked 60 deals worth Rs 400 crore for this season, excluding Mumbai Indians’ deals. Meanwhile, ITW Catalyst has stitched over 20 different sponsorship deals for multiple IPL teams.
The appeal of IPL is such that NYSE-listed Herbalife is banking on IPL partnership to help with its ambitious expansion in tier 2 and tier 3 cities in India.
Fantasy sports apps have also surged in recent years and they make a killing from the IPL session.
“IPL is not just India’s biggest sporting event, it’s also one of the biggest draws on the global cricket calendar. While IPL does translate into growth for the fantasy sports user base, at the same time, the Fantasy Sports experience also adds substantially to the viewer experience by bringing in interactivity and transforming the passive TV viewer into an engaged enthusiast.” said Joy Bhattacharjya, Director-General at Federation of Indian Fantasy Sports.
To be sure, some former partners of the cricket league, such as Amazon Prime, Byju’s, Unacademy, PhonePe and Swiggy, have decided to stay away from this season to save costs.
Franchises eye big money
IPL team owners cumulatively spent Rs 167 crore in a so-called mini auction of players in December last year. At the mega auction for the 2022 season, the teams had spent a record Rs 551.7 crore to pick cricketers.
The franchises this season are aiming for high monetary gains. Billionaire Mukesh Ambani-owned Mumbai Indians is said to have recorded a 20-22% increase in sponsorship revenue for the 2023 edition of IPL, having roped in 11 new sponsors and taking the total sponsor count to 25.
CVC Capital Partners-owned Gujarat Titans, which only began playing last year, will clock 35% on-year growth in revenue from the upcoming edition of the tournament. Gujarat Titans had earned sponsorship revenue worth Rs 65 crore from the previous year’s IPL.
Rajasthan Royals is looking to triple its revenue from sponsorship and ticketing in the next four years, CEO Jake Lush McCrum told ET.
According to market estimates, each of the 10 IPL franchises is expected to garner sponsorship revenue between Rs 100 to 120 crore. IPL central revenue pool which includes media rights income and central sponsorship revenue is shared in equal proportion between the BCCI and the franchises.
IPL lives strong
Brendon McCullum’s blistering 158 runs for Kolkata Knight Riders in the inaugural match against Royal Challengers Bangalore in 2008 had set the stage on fire for IPL. Through the years legends of the game like Sachin Tendulkar, Sourav Ganguly or Chris Gayle and AB de Villiers have led to several fireworks on the ground, helping build the brand.
However, it wasn’t always easy for the tournament as match fixing scandals, considered one of the biggest evils of the game, has haunted authorities and team owners on a few occasions. The brand has nonetheless stood strong over these 15-16 years, a time period when favorite cricketers of 90s kids retired and the new generation started adoring the Kohlis, Sharmas or recent Gills.
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